German ZEW Economic Sentiment At 5-1/2 Year Low

Germany's economic sentiment remained unchanged at a five-and-a-half-year low in May, survey data from the Mannheim-based think tank ZEW showed Tuesday.

The ZEW Indicator of Economic Sentiment held steady at -8.2 in May, the lowest since November 2012. The score also matched economists' expectations.

"The effects of the relatively positive values for German exports and production in March 2018 have been overshadowed in the most recent survey by uncertainty motivated by recent political events," ZEW President Achim Wambach, said.

"The US decision to back out of the nuclear treaty with Iran and fears of a further escalation of the international trade conflict with the US, as well as a further rise of crude oil prices, have had an overall negative impact on economic expectations in Germany," Wambach added.

The current situation index dropped to a seven-month low of 87.4 in May from 87.9 a month ago. But the score was above the forecast of 85.5.

Data showed that the financial market experts' sentiment concerning the economic development improved slightly in May. The corresponding index rose 0.5 points to 2.4 in May. Meanwhile, the current situation index slid 1.6 points to 56.1.

According to the survey, the inflation expectations index for Germany rose 12.5 points on month to 66.5 in May as crude oil prices increased significantly after the US pulled out of the Iran nuclear treaty.

Official data released earlier in the day showed that the largest Eurozone economy expanded at a slower pace in the first quarter, largely due to weak trade.

Gross domestic product grew 0.3 percent sequentially, slower than the 0.6 percent expansion seen in the previous quarter and the expected rate of 0.4 percent. This was the weakest growth in more than a year.

Nonetheless, Destatis said this was the 15th quarter-on-quarter growth in a row, contributing to the longest upswing phase since 1991.